RIYADH, August 20, 2026, 15:38 AST — Saudi Arabian Oil Co. TADAWUL:2222 sent at least 4 million barrels of crude to China, exporting from points bypassing the Strait of Hormuz. While the route secures supply, the financial impact remains a key concern for investors.
- A minimum of 4 million barrels are set to be shipped outside Hormuz for buyers in China.
- Brent gained 1.5% to $92.90, with crude prices lifted by regional tensions.
- Aramco finished Thursday trading at SAR26.46, dropping 0.68%.
Aramco’s shipments demonstrate its ability to move barrels past a key transit point. Reuters cited traders on Thursday as saying the deals had taken place. This setup enhances supply options for Chinese refiners.
This flexibility comes with a cost. Shipments around Fujairah and extended Red Sea routes increase freight, transit time and handling. Elevated oil prices may offset some of these expenses, but cannot remove them entirely.
| Market snapshot | Latest reading | Investor signal |
|---|---|---|
| Aramco shares | SAR26.46; -0.68% | Stock did not respond to oil price surge |
| Brent crude | $92.90; +1.5% | Marked fifth consecutive rise |
| Saudi benchmark | +0.2% early trade | Wider market gained strength |
| Aramco market value | $1.71 trillion | Second-largest listed firm outside the U.S. after TSMC |
The data review occurred after the Saudi market had shut. Continuous trading concludes at 15:00 AST, after which the closing and trade-at-last sessions begin.
The 4 million-barrel transaction is significant but remains small compared with Aramco’s extensive operations. The Sidi Kerir terminal in Egypt is projected to ship around 670,000 barrels per day in August, making the recent China deal comparable to approximately six days of output from the terminal.
| Route or measure | Verified figure | Operational implication |
|---|---|---|
| China flows bypassing Hormuz | At least 4 million barrels | Instant diversification for buyers and routes |
| Sidi Kerir August shipments | About 670,000 bpd | Restricts west-coast alternative flow |
| Yanbu prior to blockade | About 4 million bpd | Indicates disruption loss scale |
| Japan shipping duration | 50–60 days versus 20 | Roughly 2.5–3 times longer in transit |
Idemitsu Kosan Co. (TYO:5019) President Noriaki Sakai stated he does not see any threat to a stable supply. However, the Japanese refiner’s new shipping route extends travel times to 50 to 60 days, compared with the previous 20-day journey.
Aramco reported robust earnings heading into the disruption. Adjusted net profit for the second quarter was $33.4 billion. After accounting for a $13.6 billion increase in working capital, free cash flow came to $12.3 billion.
| Q2 2026 measure | Result | Why it matters now |
|---|---|---|
| Adjusted net income | $33.4 billion | Acts as a buffer against higher logistics expenses |
| Free cash flow | $12.3 billion | Insufficient to fully fund the announced dividend |
| Working-capital build | $13.6 billion | Disruptions in shipping may require locking in more cash |
| Gearing | 6.2% | Rose from 4.8% in March |
| Base dividend | $21.9 billion | Yield remains a key focus |
Chief Executive Amin Nasser stated that production and exports were maintained through the East-West Pipeline, along with storage and export terminals. The most recent cargoes bound for China offer a new test of that assertion.
Valuation provides a degree of support. Aramco is valued at 13.5 times its trailing earnings and offers a yield of roughly 5.0%. Shell Plc LON:SHEL and TotalEnergies SE EPA:TTE are on lower earnings multiples, but each has a lower yield.
| Company | Market value | Trailing P/E | Dividend yield |
|---|---|---|---|
| Saudi Aramco TADAWUL:2222 | $1.71tn | 13.51 | 5.03% |
| Shell LON:SHEL | $257bn | 10.18 | 3.23% |
| TotalEnergies EPA:TTE | $202bn | 11.32 | 4.38% |
| PetroChina SHA:601857 | $296bn | Not disclosed | 4.19% |
Analysts maintain a positive outlook. A recent survey reported 10 buy ratings and eight hold recommendations, with no sell ratings. The average target price of SAR30.22 suggests an approximate 14% gain from Thursday’s closing value.
| Analyst recommendation | Count or target | Reading versus SAR26.46 |
|---|---|---|
| Buy | 10 | 56% out of 18 analysts |
| Hold | 8 | 44% out of 18 analysts |
| Sell | 0 | No sell recommendations |
| Average target | SAR30.22 | Roughly 14% higher |
| Low / high target | SAR26.80 / SAR35.00 | Approximately 1% / 32% higher |
AlJazira Capital most recently rated the stock Overweight, setting a target price of SAR29.60. The firm anticipated that flexible routes would help moderate this year’s decrease in volume. That outlook now appears to be supported by actual cargo data.
Risks: Fresh assaults could simultaneously shut down several routes. Increased freight costs might compress realized margins. A swift drop in oil prices would erase the present earnings buffer.
In the coming week, investors are advised to monitor ongoing sales outside Hormuz. While a single shipment confirms ability, a consistent series would indicate if Aramco is able to maintain volumes without impacting cash conversion.
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20 Aug 2026 · 15:37 AST
